Current Awareness in Aging Research (CAAR) Report #421--January 24, 2008

CAAR (Current Awareness in Aging Research) is a weekly email report produced
by the Center for Demography of Health and Aging at the University of Wisconsin-Madison
that helps researchers keep up to date with the latest developments in the field.
For more information, including an archive of back issues and subscription information
see:

1. US NATIONAL CENTER FOR HEALTH STATISTICS: "2006 Paradata File." (January 2008). "The 2006 NHIS Paradata File contains data about the
NHIS data collection process. It may be used as a stand-alone data
file or linked to the NHIS 2006 health data files." (data in
self-decompressing [.exe] ASCII format, with documentation in .pdf
format, and a sample SAS input file in ASCII text format).

12. STATE UNIVERSITY OF NEW YORK AT STONY BROOK NEWS RELEASE: "World
Population Will Age With Increasing Speed Over The Next Few Decades
Then Slow Down, Says SBU Researcher & Colleagues: Study Indicates
Aging Dependent on Intensity and Speed of Fertility Pattern" (Jan. 21,
2008). At the bottom of the news release is a link to "The coming
acceleration of global population ageing," by Wolfgang Lutz, Warren
Sanderson, and Sergei Scherbov (_Nature Letter, January 2008, .pdf
format, 4p.).

15. BOSTON COLLEGE CENTER FOR RETIREMENT RESEARCH ISSUE BRIEF: "Why Have
Some States Introduced Defined Contribution Plans?" by Alicia H.
Munnell, Alex Golub-Sass, Kelly Haverstick, Mauricio Soto, and Gregory
Wiles (SLP#3, January 2008, .pdf format, 16p.). Links to an abstract
and full text are available at the site.

Standard theories of insurance, dating from Rothschild and Stiglitz (1976),
stress the role of adverse selection in explaining the decision to purchase
insurance. In these models, higher risk people buy full or near-full
insurance, while lower risk people buy less complete coverage, if they buy
at all. While this prediction appears to hold in some real world insurance
markets, in many others, it is the lower risk individuals who have more
insurance coverage. If the standard model is extended to allow individuals
to vary in their risk tolerance as well as their risk type, this could
explain why the relationship between insurance coverage and risk occurrence
can be of any sign, even if the standard asymmetric information effects also
exist. We present empirical evidence in five difference insurance markets in
the United States that is consistent with this potential role for risk
tolerance. Specifically, we show that individuals who engage in risky
behavior or who do not engage in risk reducing behavior are systematically
less likely to hold life insurance, acute private health insurance,
annuities, long-term care insurance, and Medigap. Moreover, we show that the
sign of this preference effect differs across markets, tending to induce
lower risk individuals to purchase insurance in some of these markets, but
higher risk individuals to purchase insurance in others. These findings
suggest that preference heterogeneity may be important in explaining the
differential patterns of insurance coverage in various insurance markets.

Rational models of risk-averse consumers have difficulty explaining limited
annuity demand. We posit that consumers evaluate annuity products using a
narrow "investment frame" that focuses on risk and return, rather than a "consumption frame" that considers the consequences for lifelong
consumption. Under an investment frame, annuities are quite unattractive,
exhibiting high risk without high returns. Survey evidence supports this
hypothesis: whereas 72 percent of respondents prefer a life annuity over a
savings account when the choice is framed in terms of consumption, only 21
percent of respondents prefer it when the choice is framed in terms of
investment features.

Many older US households have done little or no planning for retirement, and
there is a substantial population that seems to undersave for retirement. Of
particular concern is the relative position of older women, who are more
vulnerable to old-age poverty due to their longer longevity. This paper uses
data from a special module we devised on planning and financial literacy in
the 2004 Health and Retirement Study. It shows that women display much lower
levels of financial literacy than the older population as a whole. In
addition, women who are less financially literate are also less likely to
plan for retirement and be successful planners. These findings have
important implications for policy and for programs aimed at fostering
financial security at older ages.

25. American Journal of Public Health (Vol. 98, No. 2, February 2008).
Note: Full electronic text of this journal is available in the EBSCO
Host Academic Search Elite Database and the ProQuest Research Library.
Check your library for availability of these databases and this issue.

28. AMEDEO MEDICAL LITERATURE: Note: "AMEDEO has been created to serve the
needs of healthcare professionals, including physicians, nurses,
pharmacists, administrators, other members of the health professions,
and patients and their friends. They can easily access timely,
relevant information within their respective fields... All AMEDEO
services are free of charge. This policy was made possible thanks to
generous unrestricted educational grants provided by AMGEN, Berlex,
Eisai, Glaxo Wellcome, Novartis, Pfizer, Roche, and Schering AG."

35. KAISER FAMILY FOUNDATION: "Medicare Health and Prescription Drug Plan
Tracker." "To help people monitor changes in private plans in
Medicare, the Kaiser Family Foundation has updated its interactive
online resource, the Medicare Health and Prescription Drug Plan
Tracker, with new 2008 data. The Tracker provides local, regional and
national information about Medicare Advantage plans, including HMOs,
regional and local PPOs, private fee-for-service plans, and special
needs plans. It also includes current information on stand-alone
prescription drug plans offered, along with updated 2007 enrollment
data for Medicare Advantage and stand-alone prescription drug plans.
The online tool can be used to monitor changes in Medicare Advantage
enrollment over time within counties, states and nationally.